Don Cayo: Canadian companies go green for profit

Don Cayo, Vancouver Sun columnist05.06.2013

Canadian companies are significantly more committed to sustainability than are their peers in most parts of the world, and green investments here are more likely to pay off, according to a just-released analysis from the office supply firm of OfficeMax Grand and Toy.

Is Canada at a tipping point where a critical mass of companies have now decided it is in their interests to lead the global trend toward greener business practices rather than be dragged along behind it?

Well, Canadian companies are significantly more committed to sustainability than are their peers in most parts of the world, and green investments here are more likely to pay off, according to a just-released analysis from the office supply firm of OfficeMax Grand and Toy. It compares results of a Canada-wide survey it commissioned with findings of similar surveys conducted by other agencies across Europe, North America, South America, Australia/New Zealand, Asia-Pacific, Africa and the Middle East.

The key results in a nutshell:

• Fully half of the 500 Canadian companies interviewed say their sustainability-related actions have added to their profits, versus 31 per cent worldwide.

• Seventy-six per cent see sustainability as necessary for being competitive, versus 67 per cent globally.

• Eighty per cent have increased their commitment to sustainability in the past year, versus 68 per cent.

• Eighty-seven per cent have permanently placed sustainability on their management agendas, versus 70 per cent.

The analysis cites the sustainability tipping point definition set out by MIT Sloan Management Review and the Boston Consulting Group as “the point at which a substantial portion of organizations are not only seeing the need for sustainable business practices but are also deriving financial benefits from these activities.”

It adds, in its own not-quite-definitive words, “The Canadian research appears to conclude that this tipping point has been reached in Canada.”

Interestingly, the solid performance of Canadian companies — unlike many of their competitors — is largely driven by bottom-line considerations, not by high-sounding societal goals.

“More than double the percentage of Canadian organizations have connected sustainability performance with financial incentives,” the analysis concludes.

Specifically, 41 per cent of Canadian companies identify the primary driver of their green initiatives as operational efficiency and lower costs, compared to just 33 per cent worldwide.

And while 32 per cent of other countries’ companies say they are motivated by organizational reputation, and 31 per cent cite “alignment with organizational goals, mission or values,” Canadians remain resolutely focused on the bottom line. Here, the second-most-important driving factor is customer demand, cited by 18 per cent, and just 15 per cent say they are stressing sustainability in response to concerns about their organization’s reputation.

These attitudes may make Canadian companies appear to be cynical, but I think this disclosure of their motivation should be seen as good news by anyone who worries about the impact of business activities on our planet’s health. Because if a focus on sustainability is to be sustainable, so to speak, it must also be affordable. And nothing’s more affordable — and hence more sustainable — than a business activity that yields a profit.

What it also means is that the opportunities to be found in growing a green economy are not limited to trendy new industries — erecting windmills, for example, or recycling yesterday’s garbage into tomorrow’s new products. They are also found in doing things we Canadians have been doing for many years — harvesting resources is a great B.C. example. It will usually require investment, sometimes substantial, to acquire technology that requires less or cleaner fuel, or that uses raw materials more effectively, or that pollutes less. But, as long as the end result is profitable, that investment will continue to be made.

It is heartening to see how many Canadian businesses already recognize this.

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